Topic: How To Invest

The Successful Investor Hotline – Friday, May 14, 2021

Article Excerpt

CANADIAN NATIONAL RAILWAY CO., $130.07, Toronto symbol CNR, is still a buy. CN operates Canada’s largest railway. Its 32,200-kilometre network stretches across the country. It also travels down through the U.S. Midwest, connecting Canada to the Gulf of Mexico. U.S.-based railway Kansas City Southern (New York symbol KSU) has now declared CN’s revised takeover offer is a “superior proposal” compared to an offer it has already accepted from CP Rail (see below). KCS operates a rail network of roughly 11,400 kilometres extends from the U.S. Midwest and Southeast into Mexico. Under CN’s new offer, it will pay $200.00 U.S. in cash plus 1.129 of a CN common share (up from 1.059) for each KCS share. Based on current prices, that works out to $321.14 U.S., which is above the KCS’s current trading price of $309.01 U.S. KCS shareholders will own 12.6% of the combined company. CP now has five business days to improve its offer. If KCS terminates the deal, it will have to pay…

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